Re-Configurative Divestments of Foreign Subsidiaries as an Organizational Process

Toshimitsu Ueta, Naoki Yasuda

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Multinational firms divest foreign subsidiaries to not only eliminate underperforming businesses but also reconfigure subsidiary networks. Although the importance of such re-configurative divestments has been emphasized by previous studies, our knowledge on how firms can effectively manage them is limited. Viewing re-configurative divestments as an organizational process of disentangling and recombining operations related to divested subsidiaries, this study examines factors facilitating them. Our empirical analysis of multinational manufacturers supports the argument that routinization of operations is a key condition for re-configurative divestments. Our analysis also confirms that multinational firms redeploy critical resources to other business units after re-configurative divestments, and the effect is stronger than redeployments following outright divestments. This study contributes to the literature of foreign subsidiary divestments by unpacking organizational processes of re- configurative divestments."
Original languageEnglish
Title of host publicationProceedings of the Eightieth Annual Meeting of the Academy of Management
EditorsGuclu Atinc
Number of pages1
Place of PublicationBriarcliff Manor, NY
PublisherAcademy of Management
Publication date2020
Publication statusPublished - 2020
EventThe Academy of Management Annual Meeting 2020: Broadening Our Sight - Virtual
Duration: 7 Aug 202011 Aug 2020
Conference number: 80


ConferenceThe Academy of Management Annual Meeting 2020
Internet address
SeriesAcademy of Management Proceedings

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